case-study-budget-hotel-industry (1)

pdf

School

Kenyatta University *

*We aren’t endorsed by this school

Course

308

Subject

Management

Date

Nov 24, 2024

Type

pdf

Pages

Uploaded by SuperIceHippopotamus21

Case Study In the mid-1980s, the budget hotel industry in France was suffering from stagnation and overcapacity. Hotel International’s (fictitious name) cochairmen challenged the company’s managers to create a quantum leap in value for customers. The mana gers were urged to forget everything they knew about the existing rules, practices, and traditions of the industry. They were asked what they would do if Hotel International were starting fresh. “ There were two distinct market segments in the budget hotel industry. One segment consisted of no-star and one-star hotels, whose average price per room was between 60 and 90 French francs. Customers came to those hotels just for the low price. The other segment was two-star hotels, with an average price of 200 francs per room. Those more expensive hotels attracted customers by offering a better sleeping environment than the no-star and one-star hotels. People had come to expect that they would get what they paid for: either they would pay more and get a decent nig ht’s sleep or they would pay less and put up with poor beds and noise. ” Hotel International ’s managers “ began by identifying what customers of all budget hotels – no-stars, one-stars, and two-stars – wanted: a good night’s sleep for a low price. Focusing on those widely shared needs, ” Hotel International ’s managers “ saw the opportunity to overcome the chief compromise that the industry forced customers to make. They asked themselves the following four questions: 1. Which of the factors that our industry takes for granted should be eliminated? 2. Which factors should be reduced well below the industry’s standard? 3. Which factors should be raised well above the industry standard? 4. Which factors should be created that the industry has never offered? The first question forces managers to consider whether the factors that companies compete on actually deliver value to consumers. Often those factors are taken for granted, even though they have no value or even detract from value. Sometimes what buyer’s value changes fundamentally, but companies that are focused on benchmarking one another do not act on, or even perceive, the change. The second question forces managers to determine whether products and services have been over designed in the race to match and beat the competition. The third question pushes managers to uncover and eliminate the compromises their industry forces customers to make. The fourth question helps managers break out of the industry’s established boundaries to discover entirely new sources of value for customers. ” In answering these questions, design a new strategy for Hotel International.

1. Identify the industry Hotel International is competing in. 2. Describe the chief compromise the industry forces customers to make? 3. Describe the widely shared needs of customers and noncustomers? 4. Assess and describe the objective the CEO presented to the project development team? 5. Indicate on the strategic canvas the region representing industry standards 6. Construct and complete the value grid. 7. Complete the Strategic Canvas by constructing the value innovation curve relative to the value curves as seen on the drawing and explain your strategic logic in respect to the three criteria: divergence, focus and compelling tagline (create a compelling tagline for new strategy)?

Industry Key Success Factors avg. 1* hotels avg. 2* hotels Eating facility Architectural aesthetics Lounges Room size Availability of receptionist Furniture & amenities in rooms Bed quality Hygiene Room quietness Price Low High Relative Level

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

Related Documents

BSBLDR502-28.pdf

Which of the following statements is NOT correct regarding the organizational culture.docx

BSBPMG532 TASK 1.docx

Final Assignment 2 Mr. David FINAL.edited.docx

RWG130986+V1.docx

Module 1 Discussion Forum (HRM).docx

Week 5 - Seven Principles of ICS_1.docx

Council on Quality and Leadership (CQL) Personal Outcome Mea.docx

Untitled document.edited - 2023-11-09T150554.482.docx

purpose of this report is to analyze and recommend ways to minimize travel and entertainment expendi

EDD 8510 7 reply A.docx

2B0B1BE0-7DBA-4E43-82CF-712264D755A3.jpeg

Recommended textbooks for you

Purchasing and Supply Chain Management

Operations Management

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Cengage Learning

Marketing

ISBN:9780357033791

Author:Pride, William M

Publisher:South Western Educational Publishing

MARKETING 2018

Marketing

ISBN:9780357033753

Author:Pride

Publisher:CENGAGE L

Principles of Management

Management

ISBN:9780998625768

Author:OpenStax

Publisher:OpenStax College

Contemporary Marketing

Marketing

ISBN:9780357033777

Author:Louis E. Boone, David L. Kurtz

Publisher:Cengage Learning

SEE MORE TEXTBOOKS

Recommended textbooks for you

Purchasing and Supply Chain Management
Operations Management
ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Cengage Learning
Marketing
Marketing
ISBN:9780357033791
Author:Pride, William M
Publisher:South Western Educational Publishing
MARKETING 2018
Marketing
ISBN:9780357033753
Author:Pride
Publisher:CENGAGE L
Principles of Management
Management
ISBN:9780998625768
Author:OpenStax
Publisher:OpenStax College
Contemporary Marketing
Marketing
ISBN:9780357033777
Author:Louis E. Boone, David L. Kurtz
Publisher:Cengage Learning